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Issues linger in Minnesota after shutdown

Resolution ‘hocus-pocus’ as massive budget woes persist

- The Washington Times - Thursday, July 21, 2011

First the good news: Beer supplies, which have dwindled amid a national heat wave, should be restocked quickly. Rest stops for summer travelers, along with some state parks, are now open. And racetracks, for gamblers feeling lucky, are taking bets once again.

The downside to Minnesota's government reopening, which creaked to a start in earnest Thursday: No significant progress was made on the state's massive budget woes, leaving lawmakers and taxpayers on track to face the same — if not bigger — deficit problems in two years.

"The governor will say he is pleased because he got $1.5 billion in additional spending. The Republican Legislature will say that there was no new increase in taxes. If that sounds like hocus-pocus, it is," said Jay Kiedrowski, a former state finance chairman and member of the Arne Carlson-Walter Mondale advisory group, which offered bipartisan expertise to help end the shutdown.

Through creative financing — deferring payments to schools and selling bonds connected to a state tobacco settlement — Gov. Mark Dayton, a Democrat, and the new GOP legislative majorities managed to deal with a projected $5 billion shortfall. But the next time they must act on a new budget, it becomes Groundhog Day all over again, analysts said.

"This was not a solution; it was simply a postponement with some negative impacts in terms of credit ratings and reputation," said Mr. Kiedrowski, a senior fellow at the University of Minnesota's Humphrey School of Public Affairs.

"They didn't really compromise or resolve the problem they faced. They kicked the can down the road."

Among those feeling better with the end of the 19-day shutdown — the longest in state history — are large cities that faced massive cuts in state aid.

Recipients of social services such as those in nursing homes and with disabilities, for example, will not be as badly hurt as previously feared. Construction projects on roads and other infrastructure will resume soon, and state licensing bureaus will reopen at full capacity, making services easier for some residents whose permits were held at bay during the standoff.

"There clearly are people that are better off because of this budget," Mr. Kiedrowski added. "It just wasn't balanced honestly. Our group said there should be no accounting shifts and no borrowing from future tax receipts. We didn't expect that we would save the day, but we were hoping to emphasize some of these points that they could use to create a true compromise. I'm sure that all are disappointed in this outcome."

Political consultant Dusty Trice said the unfortunate gridlock in Minnesota has been going on for years, noting the same atmosphere prevailed when Gov. Tim Pawlenty, a Republican, bumped up against a Democrat-controlled Legislature. Now the balance of power is reversed with a Democratic governor and a GOP majority in both houses.

Minnesota politics, while usually civil, he adds, "has gotten unusually contentious."

"Minnesota has had a long time with this," he said of the political divide. "It's a lot of stuff that has already been passed down and never handled. The 'kick it down the road' saying is apt."

The real tab from the 2011 shutdown may come in years ahead, when the governor and others must explain themselves to voters, Mr. Trice added.

"Long term, I think this is probably not going to play well for the individual legislators," Mr. Trice said, noting that the governor and Senate candidates may also get caught in the fray come re-election time.

State lawmakers must face the voters again in 2012, and U.S. Sen. Al Franken, a Democrat, and Mr. Dayton would be on the ballot two years later.

Said Mr. Trice: "I think this is, long range, going to hurt the Republicans, and frankly I would be surprised that they keep the [state legislative] majority. They barely had it this time."

As for state residents, be warned. More political battles are likely in the next election cycles.

"Frankly, I would hate to have a TV in 2016," he said, "because it's going to be a nightmare for people in the state."

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